Leading industry experts discuss the implications of the impending Bitcoin halving event for the market and offer advice to investors on how to get ready for it.

However, what precisely is the Bitcoin halving, and why does it impact the cryptocurrency's price?

The blockchain that powers Bitcoin was coded by its anonymous creator, Satoshi Nakamoto, with the intention of halving the amount of Bitcoin accessible to miners every 210,000 blocks added to the chain, or about every four years.

As a result, mining becomes less lucrative and the rate of creation of new Bitcoins decreases. Halving the pace at which new coins are sent into circulation slows down the amount of time it will take Bitcoin to reach its 21 million token maximum supply. Approximately 19 million tokens have been distributed thus far.

The implications of the Bitcoin halving for investors
As a result of the Bitcoin halving, which reduces the incentive for miners, JPMorgan expects the price of the cryptocurrency will decline since the market is still overbought.

The price of the cryptocurrency, which is currently about US$61,200 after recently hitting an all-time high of US$73,000, is still higher than both its estimated US$42,000 production cost following the halving and JPMorgan's volatility-adjusted comparison with gold.

The cost of producing Bitcoin has historically served as a floor for its price. JPMorgan also thinks that the lack of venture capital investment would depress the price of bitcoin.

The Coincover Head of Strategy, Duncan Ash, believes that the halving event will have benefits in the medium to long run.

"Short-term supply and demand imbalances brought on by the impending halving will increase market pressure as more investors compete for a larger share of the pie," he predicts.

This is probably going to go on until the high price scares off new investors, bringing the number of buyers and sellers back into closer balance and stabilizing the market.

The industry will also see an increase in customers, market capitalization, and liquidity. As a result, the market is probably going to experience some stabilization in the medium to long run.

In a similar vein, Fireblocks' MD of Financial Markets, Stephen Richardson, is confident in Bitcoin's ability to withstand further reductions.

He says: "The SEC's historic approval of spot Bitcoin ETFs in January, which gives institutional and retail investors exposure to this asset class without the hassle of obtaining the underlying asset, comes after this year's halving.

"As there is a limited supply of bitcoin and ETFs are derivative products that must be backed by the purchase of the underlying asset, an increase in demand for the Bitcoin ETFs may result in an increase in price movement."

Undoubtedly, the advent of spot ETFs has caused investment in Bitcoin to grow, and now that the cryptocurrency is about to undergo a halving, Philippe Bekhazi, CEO of XBTO, believes that investment and price may rise even more.

The half of Bitcoin may make it more appealing as a deflationary asset, which might attract more investment and raise prices.

As investors rebalance their portfolios in reaction to changing supply dynamics in Bitcoin, the halving might have an impact on value and market dynamics. For instance, investors may choose to get exposure through spot Bitcoin ETFs rather than Bitcoin miners.

Therefore, even if there may be some short-term volatility due to the halving event, it appears that it will have a long-term beneficial influence on Bitcoin's growth, which is encouraging for devoted investors.